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    Invest and hedge with currency linked investment deposit

    Overview

    How much do you know about foreign currency investment? When the foreign exchange market doesn’t go along with your expectations, there’re some plans to help you.

    Let’s say, previously, you’ve had HKD as the deposit currency and GBP as the linked currency for 7 days. After that, GBP has depreciated relative to HKD and you've got your principal and interest in GBP.

    But now, if you don’t need the GBP and you’re pessimistic about GBP’s future. To increase your interest income, you may want to know more about the following examples.

    Example 1: Currency linked investment deposit

    If you hold GBP and expect GBP will continuously depreciate against other currencies, one of the approaches is to choose GBP as the deposit currency. And then link to other foreign currency.

    You can choose different investment periods ranging from one week to three months and enjoy the flexibility to choose from a range of linked currencies, including HKD, USD, AUD, EUR, JPY, CAD, CHF, NZD, and CNY. To choose the right linked currency, it’s important to understand the relationships between different currencies as the market is greatly affected by currency policies.

    Let’s suppose you choose GBP as the deposit currency and link against HKD. On the maturity date, you’ll receive the maturity payment (principal + interest) in either the linked currency or the deposit currency at the agreed exchange rate.

    If GBP depreciates as predicted, at the time of settlement, the exchange rate of GBP/HKD is lower than the agreed exchange rate, you’ll receive the principal and interest in GBP. Conversely, if GBP appreciates, at the time of settlement, the exchange rate of GBP/HKD is equal to or higher than the agreed exchange rate, the maturity payment you receive will be converted into the linked currency based on the agreed exchange rate.

    Please note that exchanging your deposit into the linked currency is equivalent to selling GBP (deposit currency) based on the agreed exchange rate. You may bear losses due to a drop in the exchange rate.

    To know more about how currency-linked deposits work, view our Forex Investment Guide or learn more about the characteristics of foreign exchange.

    Example 2: Foreign currency investment deposit with capital protection

    If you’re looking for another approach, consider subscribing to a foreign currency investment deposit that guarantees 100% of the principal at maturity.

    You can select your preferred currency combination and choose GBP as the deposit currency. The investment period can be as short as one month. The minimum online subscription amount is as low as HKD 5,000. Regardless of how the linked currency performs at maturity, 100% of the principal and the minimum return are guaranteed.

    Check today’s rate and know more about the top ten highest transaction volume linked currency combinations.

    Explore our products

    Investment Funds

    • Online subscription as low as HKD5,000
    • Capture global investment opportunities
    • Diversified risk by including various underlying assets in one fund
    Learn more
    Investment involves risk.

    MaxiInterest Investment Deposit

    • Enjoy potential interest return
    • May exchange up to 10 different linked currencies at pre-defined exchange rate upon maturity
    • Invest online with just HKD5,000
    Learn more
    This is a structured product involving derivatives. The maximum potential gain is limited to the pre-agreed interest rate. Investment involves risks. Price of FX exchange may go up or down. You should read and understand all the relevant product documents/service terms and conditions and risk disclosure statements before making any investment decision.

    Equity Linked Investments ("ELI")

    • Potential return based on performance of linked stocks
    • Flexible tenor from 1 month to 3 year
    • Customised strike price
    Learn more
    Investment involves risk.

    Bonds and Certificates of Deposit

    • Steady income stream
    • Predictable return with relatively lower volatility
    • Diversify risk and offer relative stability to a portfolio
    • A wide selection of bonds and Certificates of Deposit with different investment tenors
    Learn more
    Investment involves risk.

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    Equity Linked Investments (ELI) 101

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    Footnote

    Other point(s) to note

    Risk disclosure statement of capital-protected investment deposit

    • This is a structured product involving financial derivatives. The investment decision is yours but you should not invest in the Capital-Protected Investment Deposit unless the intermediary who sells it to you has explained to you that the product is suitable for you having regard to your financial status, investment experience and investment objectives. Investors should read the Important Facts Statement of the relevant investment type, the relevant term sheet, Terms and Conditions and risk disclosure statement before making any investment decision.
    • Investors should note that this product is not a normal time deposit and thus should not be considered a normal time deposit or its alternative.
    • This product is not a protected deposit is not protected by the Deposit Protection scheme in Hong Kong.
    • Investing in this product is subject to the Bank’s credit risk.
    • Renminbi (RMB) is subject to foreign exchange control by the PRC government and thus investors investing in the Currency-Linked Capital Protected Investment Deposit involving RMB are subject to the currency risk of RMB

    Risk Disclosure Statement of MaxiInterest Investment Deposit

    • This is a structured product involving financial derivatives. The investment decision is yours but you should not invest in the MaxInterest Investment Deposit unless the intermediary who sells to you has explained that the product is suitable for you regarding your financial status, investment experience and investment objectives. Investors should refer to related materials such as terms and risk disclosures of different products before making any investment decisions.
    • Investors should make note that this product is not principal protected and different from time deposits, it should not be seen as a general time deposit or its substitute.
    • The earnings on this product are limited to the nominal interest payable and the investor’s principal amount and interest will be paid by either the deposit currency or the linked currency, whichever depreciates relatively. Investors should bear the potential losses due to the depreciation which can also be substantial. Investors must also bear the necessary fees if the product is withdrawn before maturity. Such losses and expenses may reduce the interest income and principal of the "MaxInterest" investment deposit. Investors should seek professional advice based on their needs. The terms and conditions can be obtained from any branch of Hang Seng Bank Limited.
    • This product is not a protected deposit and will not be protected by the Hong Kong Deposit Protection Scheme.
    • Investing in this product is subject to the Bank’s credit risk.
    • Renminbi (RMB) is subject to foreign exchange control by the PRC government and thus investors investing in the MaxiInterest Investment Deposit involving RMB are subject to the currency risk of RMB.